Contracts Flashcards
What is stipulated sum (fixed fee)?
This compensation method is a fixed sum for a specific set of services. Typically paid out monthly according to the percentage of completion of the five basic phases of services.
What are reimbursable expenses?
These are expenses paid by the architect that are directly related to the project. The owner pays the architect for these in addition to the fee paid for the architectural services.
What is cost plus fee?
This compensation method compensates for actual expenses of doing the job plus a reasonable fee for profit. Actual expenses include salaries, employee benefits, direct expenses, and office overhead.
What are different variations of the cost plus fee compensation method.
The following are variations of this compensation method.
- Multiple of direct personnel expense
- Multiple of direct salary expense
- Hourly billing rates
What is the multiple of direct personnel expense compensation method?
This is a variation of the cost plus fee approach where the direct salary of the employee is determined and multiplied by a factor to account for normal and required personnel expenses such as taxes, sick leave, health care, etc. This amount is then increased by a multiplier that includes provisions for overhead and profit.
eg: an employee’s direct personnel expense is calculated at $30.00 an hour and the multiplier is 2.5, the cost to the client for that person is $75.00 an hour.
What is the multiple of direct salary expense compensation method?
This is a variation of the cost plus fee approach (sometimes called the net multiplier method) where direct salary of the employee is determined and a larger multiplier than that associated with the direct personnel expense approach in order to provide for employee benefits.
What is the hourly billing rates compensation method?
This is a variation of the cost plus fee approach where the multiplier is built into the hourly rate. The client sees only one number for each time for employee working on the project.
What is percentage of construction cost?
In this method of compensation, the professional fee is a fixed percentage of the cost of construction. While popular in the past, this is less commonly used than other compensation methods. From the owner’s viewpoint, it appears to give the architect an incentive to keep the cost of construction high; from the architect’s viewpoint, a low-cost project can require just as much work as an expensive project, sometimes even more.
What is unit cost?
Using this compensation method, fees are based on a definable unit of measure such as square footage or per-house basis. This method can work great for very repetitive work.
The AIA B101 is which contract document?
This contract type is the Standard Form of Agreement between Owner and Architect. This document includes both the provisions of the agreement and the architect’s scope of services specific to the project.
What are an architect’s basic services as described by the AIA B101 Standard Form of Agreement between Owner and Architect?
These include the five traditional phases of a design-bid-build project:
- Schematic Design
- Design Development
- Construction Documents
- Bidding or Negotiation
- Construction Administration
According to the AIA B101 Standard Form of Agreement between Owner and Architect, what are additional services?
These are services above and beyond the architect’s basic services and can include:
- Programming
- Building Information Modeling
- Sustainable Building Rating System Certification
- Post-occupancy Evaluation.
According to the AIA B101 Standard Form of Agreement between Owner and Architect, where are the Architects responsibilities spelled out?
In this document, the architects responsibilities are spelled out in Article 2 - General Responsibilities, Article 3 - Basic Services, & Article 4 - Additional Services.
According to Article 2 of the B101 Standard Form of Agreement between Owner and Architect, what are the Architect’s Responsibilities?
According to this document, the architect is responsible for providing a standard of care consistent with the level of professional skill and care that is ordinarily provided by architects practicing in similar locations under similar circumstances.
The architect must not partake in activity or employment that could reasonably appear to compromise the architect’s judgement.
Additionally, this document discusses the types and amounts of insurance that the architect must carry for the project.
What is privity?
This concept states that two parties in a contract are not liable to a third party. Lack of privity protects an architect from claims made by a subcontractor. Privity of contract is the relationship between the parties of the contract and generally protects parties without privity of contract from filing suits.
